Region to adopt new strategies for APD
BRIDGETOWN, Barbados, Nov 23, CMC – Barbados says the Caribbean will need to adopt a new strategy to ensure a “fair” resolution to the controversial Air Passenger Duty (APD) tax that travellers out of the United Kingdom pay based on their destination.
Tourism Minister Richard Sealy said that while the United Kingdom government has indicated it is not going to abolish the APD, the fight would now be to have the region re-banded within the existing system.
“We are asking for the Caribbean to be re-banded. We are currently in Band ‘C’ and the US is in band ‘B’. We are simply saying, because of how the APD is calculated, you pay a smaller (tax) when you are going to Honolulu, Hawaii or the west coast of the U.S. than when you are coming to Barbados, which is closer.
“We believe there is a special case for the Caribbean, the most tourism dependent region in the world, to be re-banded,” Sealy said.
The APD, instituted in 1994, is a British environmental tax aimed at offsetting aviation’s carbon footprint. In its initial stage, it was set at £5 (US$7.85) per person.
Earlier this year, a number of leading international airlines, including British Airways, EasyJet, Ryanair and Virgin Atlantic urged Osborne to suspend the planned APD pending the outcome of an independent study of the economic effects of such a tax rise.
The airlines said that the eight per cent increase introduced in April would reduce passenger numbers and hinder the UK’s economic recovery.
They said that as a result of the increase, a family of four flying from the UK to the Caribbean would have to pay close to £400 (US$625.08) in taxes. In 2005 such a family would have paid a total of £80 (US$125.06) in taxes.
Regional governments have been lobbying London to remove the tax, which they said negatively affect the growth of the tourism industry since the Caribbean has been placed in a band that makes travel to the region much more expensive than travelling from London to the United States.
Earlier this month, Caribbean Community (CARICOM) Chairman and St. Lucia’s Prime Minister Dr. Kenny Anthony expressed disappointment that the United Kingdom has “opted to retain its discriminatory approach” in dealing with the APD.
Anthony had written to the British Chancellor of the Exchequer George Osborne on the “deleterious effect” the controversial United Kingdom Air Passenger Duty (APD) tax is continuing to have on Caribbean economies.
Sealy said it is crucial to “ramp up the lobby effort and in essence try to pressure the UK Government into recognising the absurd situation”.
He said the Caribbean Diaspora in the UK could also serve as an advocate and lobby this effort, as public pressure often proved an effective catalyst for change.
“In fairness to them, they have not shut the door on us…We have had minor successes in the past but we now need to see what we can do to have something more permanent in that respect,” he added.